by admin | Apr 28, 2016 | Charity & Not-for-Profit Law
The Tax Court of Canada (“TCC”) released an informal procedure decision in the matter of Nazih c La Reine on March 22, 2016. The TCC denied the taxpayer’s appeal of the Minister’s decision to allow only
$370 of the taxpayer’s $2,240 claimed as a charitable donation for the 2013 tax year.
In particular, the TCC held that the taxpayer’s contributions to an Arabic language school and various other donations did not meet the requirements of the Income Tax Act (“ITA”) and Income Tax Regulations (“Regulations”). More specifically, the only receipt the Taxpayer produced that satisfied the receipting requirements under the ITA and Regulations was for a $370 gift made to the Mosque of Aylmer.
The TCC denied the taxpayer’s claim and followed the Federal Court of Appeal’s reasoning in Castro v The Queen (discussed in our November 2015 Charity and NFP Law Update), which was denied leave to appeal by the Supreme Court of Canada on April 14, 2016. Although this case, as an informal procedure, does not have any precedential value, it serves as another practical example of the importance of registered charities complying with the receipting requirements of the ITA and Regulations.
by Dev User | Apr 28, 2016 | Charity & Not-for-Profit Law, Employment Law, Expertise
Charity & NFP Law Bulletin No. 384, April 28, 2016
On January 26, 2016, the Ontario Court of Appeal released a significant decision concerning the enforceability of personal injury liability waivers affecting the legal rights of employees to sue their employers for injuries arising in the course of their employment duties. In Fleming v Massey (“Fleming”), the Court of Appeal held that the waiver signed by the employee was not enforceable as a matter of public policy. In allowing the appeal, the Court of Appeal overturned the judgment of the trial judge, who had granted summary judgment dismissing the employee’s lawsuit based on the waiver. This Charity & NFP Law Bulletin will review the Fleming decision, which has implications for all Ontario employers, including charities and not-for-profits.
For the balance of the Bulletin, please see Charity & NFP Law Bulletin No. 384.
by admin | Apr 28, 2016 | Charity & Not-for-Profit Law
On February 18, 2016, the Supreme Court of Canada (“SCC”) granted Google Inc.’s (“Google”) application for leave to appeal the decision in Equustek Solutions v Google Inc., regarding the power of Canadian courts to grant orders that have worldwide impact.
The facts which brought about the appeal arose from the attempt by Equustek Solution Inc.’s (“ESI”) to enforce their intellectual property rights against a former distributor of ESI’s products. The distributor was unlawfully appropriating ESI’s intellectual property, including trade-marks, and trade secrets, to manufacture counterfeit ESI products. ESI was successful in obtaining court orders against the former distributor prohibiting them from selling the competing products online. However, the distributor did not comply with the court order and the infringing products continued to be sold.
When the court orders proved ineffective, ESI sought a court order against Google, who was not a party to the dispute, in order to restrain it from publishing search results that sold or advertised the counterfeit products. The Supreme Court of B.C. granted a worldwide injunction against Google, and held that the court had jurisdiction to maintain the rule of law, and to protect its processes, which in an appropriate circumstance may include issuing an injunction against non-parties. The Court of Appeal upheld the injunction in an attempt to limit public access to the websites that the former distributor had been using to advertise and sell its products. The injunction required compliance not only with Google’s search results that displayed in Canada, but also the search results that displayed worldwide.
The Supreme Court of Canada briefly outlined the issues to be considered:
- Under what circumstances may a court order a search engine to block search results, having regard to the interest in access to information and freedom of expression, and what limits (either geographic or temporal) must be imposed on those orders?
- Do Canadian courts have the authority to block search results outside of Canada’s borders?
- Under what circumstances, if any, is a litigant entitled to an interlocutory injunction against a non- party that is not alleged to have done anything wrong?
The case will likely raise very important questions regarding the freedom to access information on the internet, and whether one country can determine what the rest of the world can see online. Additionally, guidance on remedies for intellectual property infringement from the Supreme Court of Canada is a rare occurrence. Charities and not-for-profits seeking to enforce intellectual property rights in an online world where infringers may not be located in Canada will want to closely monitor this decision, as it may introduce novel tools to enforce intellectual property rights in the digital era where cross-border activities frequently occur.
by admin | Apr 28, 2016 | Charity & Not-for-Profit Law, Privacy Law & Anti-Spam
On March 24, 2016, the Canadian Radio-television and Telecommunications Commission (“CRTC”) signed the Memorandum of Understanding between the United States Federal Trade Commission and the CRTC on mutual assistance in the Enforcement of Laws on commercial email and telemarketing (“MOU”) with the United States Federal Trade Commission (“FTC”), which concerns unsolicited telecommunication and commercial electronic messages (spam). The MOU functions to strengthen cooperation between the CRTC and FTC in the enforcement of spam and telemarketing laws, and to facilitate research and education in this regard as well.
The MOU does not legally bind Canada or the US, but it “sets forth the Participants’ intent with regard to mutual assistance and the exchange of information for the purpose of enforcing and securing compliance…”. Section II.B.1 states that the Participants understand that it is in their best interest to:
- Cooperate with respect to the enforcement against Covered Violations, including sharing complaints and other relevant information and providing investigative assistance;
- Facilitate research and education related to unauthorized telemarketing and unauthorized telephone calls;
- Facilitate mutual exchange of knowledge and expertise through training programs and staff exchanges;
- Promote a better understanding by each Participant of economic and legal conditions and theories relevant to the enforcement of the Applicable laws; and
- Inform each other of developments in their respective countries that relate to this Memorandum in a timely
The MOU also sets out procedures related to mutual assistance. For instance, both countries are to designate primary contacts for communication (i.e. the Chief Compliance and Enforcement Officer of the CRTC). It also discusses limitations and the fact that both countries maintain discretion as to whether or not they decline a request for assistance or the extent to which they will participate. Over all, the MOU emphasizes the long-standing partnership between the two agencies and encourages U.S. and Canadian authorities to continue and expand information exchanges, and provide assistance for cross-border anti- spam enforcement purposes.
Although the MOU has little immediate impact on the charitable and not-for-profit sector in Canada, the experience of the FTC in investigating non-compliance by charities in the US with such rules may carry over to the CRTC. In this regard, charities or non-profit organizations that are impacted by Canada’s anti- spam laws or telemarketing regulations should review their compliance to ensure that their practices do not become a lesson in non-compliance for the FTC.
by admin | Apr 28, 2016 | Charity & Not-for-Profit Law
In The Sidney and North Saanich Memorial Park Society v. British Columbia (Attorney General), the British Columbia Supreme Court approved a trustee’s application to modify several terms of a charitable trust that was established in 1965. The background facts and issues reviewed in the case are lengthy and complex. However, in general terms, the trust involved the administration of land and property located in the Town of Sidney for the benefit of nearby residents. One of the terms of the trust involved a requirement that the trustee maintain an area of the property (which had been expropriated long ago and no longer formed part of the trust property) for purposes of a war memorial. The Court granted the trustee’s request, amongst others, to alter that portion of the trust so that the trustee could preserve another section of the trust lands for purposes of a war memorial.
Another provision of the trust required that if any lands forming part of the trust property was expropriated, the proceeds from the expropriation must only be used to purchase new lands and improve and maintain those new lands (i.e. and not to maintain the prior existing lands that were part of the original trust property). The Court allowed the amendment so that the trustee could apply the expropriation funds for all of the trust property, otherwise the prior existing trust property would fall into disrepair.
In arriving at the decision to approve the requested changes to the trust, the Court stated that it had “inherent jurisdiction for administrative scheme-making for charitable trusts. In cases where it cannot be said that the requirements to achieve the purposes of a charitable trust have become sufficiently impracticable or impossible so as to engage the cy-près doctrine, the courts may nonetheless, pursuant to this administrative scheme-making jurisdiction, vary the administrative terms of a trust for the furtherance of charitable purposes.”
by admin | Apr 26, 2016 | Charity & Not-for-Profit Law
The Fairness in Charitable Gifts Act Debated in House of Commons
On April 11, 2016, Bill C-239, An Act to amend the Income Tax Act (charitable gifts), also know as The Fairness in Charitable Gifts Act, (“Bill C-239”) was debated in Parliament for the first time. As discussed in our March 2016 Charity & NFP Law Update, Bill C-239 was introduced as a private member’s bill on February 25, 2016, by opposition MP Ted Falk. Bill C-239 proposes amending the Income Tax Act to increase the amount that an individual taxpayer is able to claim during a taxation year for donations made to charities. Specifically, Bill C-239, if passed, would increase the tax credit available for charitable donations by individuals to match the current tax credit available for political donations.
Reminder That Ontario Legislation on Forfeited Property to Come into Force in December 2016 As described in our January 2016 Charity & NFP Law Update, the Ontario government has passed new legislation to address situations wherein corporations, including charities and not-for-profits, dissolve without having properly disposed of all of their assets. On December 10, 2015, Bill 144, the Budget Measures Act, 2015 (“Bill 144”), received Royal Assent and enacted five new statutes, including the Forfeited Corporate Property Act, 2015 (“FCPA”) and the Escheats Act, 2015 (“EA”).
The FCPA and EA both come into force on December 10, 2016, and will address how forfeited property is dealt with in Ontario, along with implementing changes to the role of the Public Guardian and Trustee (“PGT”) in dealing with forfeited property. The FCPA will give the Minister of Economic Development, Employment and Infrastructure sole jurisdiction over forfeited corporate real property. The PGT under the EA, on the other hand, will retain discretionary authority to take possession, and dispose of, forfeited corporate personal property, as well as the property of heirless deceased persons. In addition, the new legislation will introduce changes in the processes by which claimants will be able to recover forfeited corporate property. As the FCPA and the EA may have application to incorporated charities and not-for- profits in Ontario facing either intentional or unintentional dissolution of their corporate status, including involuntary dissolution under the Canada Not-for-Profit Corporations Act for failure to continue, it will be important for such corporations to consult with their legal counsel to determine the impact of these new acts.
Impact of BC Provincial Budget on Charities and Not-for-profits
On March 10, 2016, Bill 10 – 2016: Budget Measures Implementation Act (“Bill 10”) passed third reading and received Royal Assent in the B.C. Legislature, implementing a number of measures that were introduced in the British Columbia Budget and Fiscal Plan 2016/2017-2018/2019 (“Budget 2016”) on February 16, 2016.
Of relevancy to charities, Budget 2016 provides that for each year of the fiscal plan, the B.C. government will distribute approximately $250 million of its gaming income to charities and local governments. As well, effective February 17, 2016, a new non-refundable farmers’ food donation tax credit will be available to individuals and corporations that carry on the business of farming and donate a qualifying agricultural product to a registered charity that provides food to those in need or helps to operate a school meal program. The credit is available for the 2016, 2017, and 2018 tax years, after which it will be reviewed.
Upcoming Ontario Municipal Elections Act Amendments
On April 19, 2016, the Ontario government announced that the Standing Committee on Finance and Economic Affairs (the “Committee”) will meet on May 5 and May 12, 2016 to consider Bill 181, An Act to amend the Municipal Elections Act, 1996 and to make complementary amendments to other Acts (“Bill 181”).
In addition to introducing a ranked balloting system for municipal elections. Bill 181 will also impose limitations on advertising. Currently, the City of Toronto is able to prohibit corporations, including charities and not-for-profits, as well as trade unions, from making contributions to candidates for city council. Bill 181 will re-enact this provision as section 88.15 in the Municipal Elections Act, 1996, and will provide this authority to all other municipalities in Ontario.
Parties interested in making written submissions concerning Bill 181 to the Committee are asked to send them to the Clerk of the Committee by May 12, 2016, at 6:00 pm.
Ontario Expands Scope of Lobbying Legislation
On April 15, 2016, the Office of the Integrity Commissioner of Ontario released an announcement indicating that substantive changes are being planned to the Lobbyists Registration Act, 1998. These amendments will be made pursuant to the Public Sector and MPP Transparency and Accountability Act, 2014, S.O. 2014, c. 13, which received Royal Assent on December 11, 2014 (the “Act”).
Amendments to the Act will require entities that have paid employees who lobby for more than 50 hours per year to register. This replaces the previous regime that required registration only when individual lobbying activities comprised a “significant” part of employee duties, defined as 20% of overall work hours. Additionally, registration itself will now be renewed every 6 months, as opposed to annually.
As well, the Act will also grant the Integrity Commissioner of Ontario investigative powers for matters of suspected non-compliance, penalties for which include: prohibition from lobbying for up to two years and public statements about the violation. These amendments will come into force upon proclamation, the date of which has yet to be announced.
